It is expected that ABLE accounts will be available in Texas during 2018. However, these accounts won’t be available to everyone. They serve a specific purpose as defined by the federal government when the Achieving a Better Life Experience (ABLE) legislation to create these accounts was passed in December 2014 and by the Texas state government when the legislation to create these accounts was passed in May 2015.
The Basics of Texas ABLE Accounts
You may be eligible for an ABLE account if you became disabled by the age of 26 and you currently qualify for Social Security disability, Social Security Supplemental Security Income, or you can obtain a disability certification pursuant to rules that are expected to be written by the United States Treasury Department.
If you qualify, you may open an ABLE account. The ABLE account is a special type of savings account that you can use for disability-related expenses. These expenses include things that are related to maintaining or improving your health, your independence, or your quality of life. More specifically these expenses could include, but are not limited to, education, housing, health care costs, assistive technology, and legal fees related to your disability.
You may only have one ABLE account. However, anyone can deposit money into your account and all withdrawals are tax free if they are used to pay for qualified disability expenses. Additionally, any earnings on the investments in your account will grow tax free.
ABLE Accounts Should Have No Impact on Social Security Disability
Social Security disability is not a financial need based program. Thus, your savings accounts—whether ABLE accounts or other accounts—should not be considered in determining whether or not you are eligible for Social Security disability benefits.
All of this information can be confusing and it can be difficult to know what to do if you become disabled. We encourage you to learn more about your options so that you can make the right choices for you. For more information about ABLE accounts in Texas, you can visit the state’s Texans Achieving a Better Life Experience website and for more information about Social Security disability, you can contact us directly via this website or by phone at your convenience.
by Paul B. Burkhalter Managing Partner of Morgan & Weisbrod, Board Certified in Social Security Disability Law.